Latino Growth Signals Need for Change

By 2025, one-fourth of the U.S. will be Latino. But the implications for the Latino population are already hitting economic, educational, marketplace and workforce agendas.

According to a November 2010 study from the Selig Center for Economic Growth, at 50 million strong, Latino purchasing power is $1 trillion and rising at a rate of $100 billion annually.

Half of the children at today’s playgrounds are Latinos. Economically, by growing at three times the rate of the rest of the population, Latinos accounted for half of the U.S. population rise in the past decade. The United States is already the second largest Spanish-speaking country in the world. March 2011 numbers from the U.S. Census Bureau indicate by 2020, 20 percent of the workforce will be Latino.

The U.S. is in the midst of a Latinopalooza, a cornucopia of Latino cultural touchstones that are changing everything about U.S. culture. Salsa has surpassed ketchup in U.S. condiment sales. Dulce de leche ice cream is in demand. Mexican restaurants are some of the most common ethnic eateries in the county, and, in 2010, the New York Times noted the soaring popularity of Peruvian food. This raises questions for both Hispanics and mainstream Americans about race and ethnicity, culture and identity. Latinos are changing the U.S. And they, in turn, are being changed by it, which has profound implications for diversity workforce management strategies in today’s organizations.

On the Job
Latinos have a participation rate in the workforce of almost 68 percent, according to the U.S. Bureau of Labor Statistics. Nearly three-fourths of the predicted growth in the labor market by 2020 will be due to Latinos. Corporate America’s efforts to win the war for talent will be contingent on its ability to attract the Latino worker. This will require adapting to Latino worldviews and making distinctions between preferences and requirements, as diversity expert Roosevelt Thomas, chairman and CEO of Roosevelt Thomas Consulting & Training, has said throughout his career in speeches and workshops.

Despite their market impact and demographic strength, many Latinos are sliding to the margins in corporate life. In Latino Talent: Effective Strategies to Recruit, Retain and Develop Hispanic Professionals, Robert Rodriguez, president of DRR Advisors, writes, “Along with discrimination, Latinos are also the victim of common negative stereotypes including being perceived as being too passive and lacking the conviction necessary to be a good manager, of being too emotional to fill leadership positions. These stereotypes often are the result of a lack of understanding about how cultural principles and traditions common in the Latino community impact actions and behaviors.”

Organizations’ continued nurturing of traditional organizational cultures and talent management systems may be having an exclusionary impact on Latino talent. Cultural differences show up in how an organization attracts, retains, engages and develops talent. It starts with philosophical stances — “everyone owns his or her own career” — that are operationalized through mechanisms such as online universities with developmental maps that employees can read, follow and fill out as they chart their own course. Then there are conversations: How did I do? How will I be rewarded?

What do I need to do next? All of this gets codified in the performance and development review. This works for many employees. Problems emerge due to a lack of awareness about how culturally biased this approach to development and advancement actually is. It is premised on an individualistic, non-hierarchical, internal control — “I control my destiny” — task-oriented worldview. This is not inherently bad or good. It’s actually good if the workforce homogeneously reflects this particular worldview. But for many Latinos this is the opposite of what is attractive and engaging about an organization. Latino worldview tends to be more communal, hierarchical, external control — “things happen due to luck or God’s will or because it was meant to be” — relationship based. A more guided process to career development where one’s manager is “looking out for our success” is more attractive to Latino talent.

With such disparate views of how to get things done, Latinos have made few inroads into leadership positions in corporate America. According to the Hispanic Association on Corporate Responsibility (HACR), among the 1,200 executive and director positions measured for its 2009 Corporate Inclusion Index, Hispanics held 61 positions.

Cultural misunderstandings aren’t the only barrier; discrimination is also a factor. In Latino Talent, Rodriguez wrote that “over 54 percent of Latinos indicate that they have seen an increase in discrimination against them.” These Latinos felt that in the past five years, they have not been hired or promoted because of their ethnicity, and they have been called names or insulted. A similar study done by the Pew Hispanic Center and Kaiser Family Foundation in 2006 indicated a majority of Latinos felt that discrimination against Latinos is a problem in schools (75 percent) and in the workplace (78 percent).

Unless they act on these differences and obstacles, companies’ current efforts to attract Latinos will not work effectively. Conversely, organizations that assess where culture change is necessary and then make changes will be well-positioned to attract a greater share of Latino talent. Further, they must allow themselves to be changed by the Latinos in their midst if they hope to retain them.

Source: Brenda Machado Koller and Dianne Hofner Saphiere, Cultural Detective, 2012

In the Stores
It’s all about a shifting market, said Laura Ann Spencer, vice president of Perma-Seal, a basement waterproofing company in Downers Grove, Ill. The company’s target audience was do-it-yourself white baby boomers. But white Gen Xers and Gen Yers prefer to outsource hammering, sawing and painting. While Perma-Seal strategizes how to generate demand among younger generations as aging boomers become less inclined to sweat over home repairs, the company is setting its sights on Latinos to fill a growing market gap.

Many corporations are not ready to sell to the Latino consumer. They are equally ill prepared to sell themselves as a great place to work for Latino talent.

Both in the marketplace and in the talent space organizations’ efforts are superficial at best, focused on Spanish language collateral or extolling the fact that they have a Latino employee resource group. Solutions should go much deeper.

Corporations don’t understand the Latino mindset, the beliefs, behaviors and preferences that affect their pocketbooks and career decisions.

Diversity executives must work with their human resource and business peers to reconsider the philosophies that inform their HR programs and business strategies through the lens of their own culturally influenced preferences, and understand how these may be similar and different for Latinos. They will find there are practices that are the opposite of what would attract, hire, engage and advance Latino talent.

They need to help organizations understand the diversity underneath the Latino umbrella. For example, is the organization’s talent market mostly Puerto Rican, Mexican or South American? Mostly first-, second-, third-, fourth-generation Latinos? A mixture? Depending on the answer, talent strategies and business tactics need to be nuanced differently. But there are still broad strokes that create a common experience and worldview — and common challenges — for many Latinos. How can an organization reach the Latino consumer without a labor force that reflects that marketplace?

The following will help:

• Use surveys and focus groups to find out what is attractive and not attractive about the corporate culture for Latinos.

• Segment data on different types of Latinos by national identification, age or immigration wave.

• Test findings with Latino employees. Involve them in efforts to interpret the data and make meaningful changes.

Diversity executives have to help companies win over Latino talent, because they’re going to need them to win the marketplace war.

Andres Tapia is the president of Diversity Best Practices, a diversity thinktank and consultancy, and the author of The Inclusion Paradox: The Obama Era and the Transformation of Global Diversity. He can be reached at editor@diversity-executive.com.